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HomeAltcoins NewsHere's what the new 'Statemint' proposal means for governance in Polkadot

Here’s what the new ‘Statemint’ proposal means for governance in Polkadot

Parity Technologies plans to develop and propose a generic assets parachain called Statemint as one of the first common-good chains on Polkadot, Cryptoreportage learned in a release today.

Benefiting Polkadot 

Polkadot’s and Kusama’s on-chain governance can grant parachain slots by public referendum, instead of determining the slot winner via its auction mechanism.

The parachains that are granted slots via governance, known as common-good parachains, provide core functionality that would be susceptible to the free-rider problem if left to the auction market dynamics.

This parachain would provide functionality for deploying assets — from tokenized artwork to Central Bank Digital Currencies — in the Polkadot network and give their users a better experience with lower fees than existing solutions.

As a common-good parachain, Statemint will stay fully aligned with the Relay-chain’s token holders. As such, the Relay-chain’s governance bodies will have control over the direction of the chain and make decisions such as registering an asset without requiring a deposit, changing parameters like the deposit amount and proposing upgrades to the chain’s logic and functionality. 

The Relay-chain’s Council may also provide funding for maintenance and infrastructure costs, such as running full nodes and collators.

The problem

On-chain assets are usually issued as smart contracts with common interfaces. Using smart contracts for standardized functionality is destined for inefficiency and high fees, as smart contract platforms must meter every step of execution. 

Metering the same logic repeatedly wastes system resources because the execution complexity and resource usage are well known; there’s no need to meter it every time it executes.

But parachains can encode the interface for assets directly into the chain, allowing cheap and fast execution of common functionality. By encoding asset functionality directly on-chain, the system does not need to meter standard function calls because it already registered the logic and knows what fee to charge.

The generic assets chain would allow anyone to deploy an asset as long as they put down a deposit in DOT (or KSM for the Kusama parachain). If there is approval from the Relay Chain’s governance, then the asset may also be registered without a deposit. 

How Statemint helps

Statemint will allow diverse entities, ranging from artists issuing tokens for their work to central banks issuing Central Bank Digital Currencies, to deploy their assets to the Polkadot network.

By encoding these standards as first-class logic into the chain and allowing non-DOT-holding accounts to use the assets, users will face lower fees and friction when using their assets in the network.

Deploying and maintaining this parachain with on-chain governance will show the power of the Polkadot community to organize and provide a utility to all applications and users in the network.

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